Earmarks to Bear Tougher Scrutiny Under Obama Plan

March 11, 2009 at 6:00 PM EST

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President Obama signed a $410 billion spending bill Wednesday, despite the fact that the bill contains the kind of earmarks he decried on the campaign trail. Congress watcher Norman Ornstein examines the issue.

GWEN IFILL: President Obama insisted today Congress must rein in the abuse of earmarks in spending bills. At the same time, he signed off on a huge bill containing thousands of the special projects.

Kwame Holman has our lead story report.

KWAME HOLMAN: The president defended his decision to sign the $410 billion omnibus bill funding the government the rest of this fiscal year. He said he reluctantly accepted nearly 8,000 earmarks.

BARACK OBAMA, President of the United States: I am signing an imperfect omnibus bill because it’s necessary for the ongoing functions of government, and we have a lot more work to do. We can’t have Congress bogged down at this critical juncture in our economic recovery.

But I also view this as a departure point for more far-reaching change. So let there be no doubt: This piece of legislation must mark an end to the old way of doing business and the beginning of a new era of responsibility and accountability that the American people have every right to expect and demand.

KWAME HOLMAN: As Mr. Obama envisions it, that new era would mean higher standards and greater transparency when lawmakers seek special projects.

BARACK OBAMA: Earmarks must have a legitimate and worthy public purpose. Earmarks that members do seek must be aired on those members’ Web sites in advance so the public and the press can examine them and judge their merits for themselves.

Each earmark must be open to scrutiny at public hearings, where members will have to justify their expense to the taxpayer.

I recognize that Congress has the power of the purse. As a former senator, I believe that individual members of Congress understand their districts best and they should have the ability to respond to the needs of their communities. I don’t quarrel with that.

But leadership requires setting an example and setting priorities. And the magnitude of the economic crisis we face requires responsibility on all our parts.

KWAME HOLMAN: Outside Congress, earmarks are routinely denounced as “pork.” But inside, the vast majority of lawmakers from both sides of the aisle view the projects as beneficial to their home states.

Democratic House member Ellen Tauscher of California agreed with some of what the president wants, as long as lawmakers keep hold of the purse strings.

REP. ELLEN TAUSCHER (D), California: This is about transparency. This is about making sure that we have members of Congress held accountable, local governments held accountable for spending that money the way the people want it to.

But at the same time, we have a representative government. And an equal branch of government is the Congress. And we are meant to take what the president’s priorities are, and we’re meant to define them as we see fit for our constituents.

KWAME HOLMAN: The president promised to work with Congress. He said he’d submit proposed cuts in earmarked spending that Congress could accept or ignore.

Among Republicans, a long-time critic of earmarks, Sen. John McCain, complained that’s not nearly good enough. He said in a statement, “The president could have resolved this issue in one statement: No more unauthorized pork-barrel projects and pledged to use his veto pen to stop them. This is an opportunity missed.”

And Republican Congressman Mike Pence of Indiana said there’s another immediate solution open to the Congress.

REP. MIKE PENCE (R), Indiana: Before we get to a reform system, Congress and this administration should embrace a moratorium on all earmarks. Until we can push away from the table, set with a banquet of pork, and reinvent this system in a way that will truly be accountable and truly be transparent to the American people, it’s hard for me to believe that we’ll ever bring about the changes that will restore public confidence in the way we spend the people’s money in large ways and small ways.

KWAME HOLMAN: Democrats showed no sign of going that far. Instead, House Democratic leaders outlined proposals building on reforms begun by both parties since 2006.

From now on, the House Appropriations Committee will submit every earmark to the appropriate agency for review, and projects granted to commercial companies will go through competitive bidding. The first test of those rules and the president’s plan will come later.

This afternoon, in private, he signed the omnibus bill, including its earmarks, into law.

Earmarks are very specific

Norm Ornstein

American Enterprise Institute

So you're not just saying, "We're going to have money for highways," but for a particular interchange, a particular building, or a particular kind of project.

GWEN IFILL: Judy Woodruff has more.

JUDY WOODRUFF: For a closer look at the earmarking process and how President Obama would change it, we are joined by Norman Ornstein, resident scholar at the American Enterprise Institute.

Good to see you again.

NORMAN ORNSTEIN, American Enterprise Institute: Thank you, Judy.

JUDY WOODRUFF: As someone who has studied the Congress and this process for many years, tell us exactly, what is an earmark?

NORMAN ORNSTEIN: An earmark is when Congress designates funds specifically for a project, a grant, or a contract. So you're not just saying, "We're going to have money for highways," but for a particular interchange, a particular building, or a particular kind of project.

JUDY WOODRUFF: How is that different from the rest of the spending structure, this appropriations process?

NORMAN ORNSTEIN: Well, often we've had earmarking of the sort done in the authorization process. In a highway bill, for example, you'll have funds specifically for a bike path or for a particular highway project.

But it's often written into the language of the report or there is a larger objective that Congress makes, and the decisions then are done by executive branch agencies, bureaucrats in the agencies who decide, based on a formula or on what Congress has said generally, where the money is going to go.

The earmark is members of Congress specifically saying where they want the money to go, not the executive agency.

JUDY WOODRUFF: And how is it determined in this process whether something's really necessary or not? Is there a method for doing that right now?

NORMAN ORNSTEIN: There's not a firm method for doing it. Basically, the way it works in the appropriations process is that individual members of Congress ask the appropriators for a particular earmark or a set of earmarks. They presumably vet them, or at least they provide some limits.

But for the most part, the decisions have been made by the individual members of Congress without close scrutiny. And that's where we've run into problems, problems with unnecessary spending, clear waste, or fraud and abuse along the way.

Increasing transparency in spending

Norm Ornstein

American Enterprise Institute

He wants to ratchet up the transparency so that every earmark proposed by a member has to go on that member of Congress's Web site.

JUDY WOODRUFF: So what exactly is President Obama proposing today to do to change this process?

NORMAN ORNSTEIN: We saw the first set of changes in Congress in 2007, when they provided more transparency. The earmarks had to be requested and open to the public, but without real transparency of the sort that Obama is now proposing.

He wants to ratchet up the transparency so that every earmark proposed by a member has to go on that member of Congress's Web site, with enough time -- in this case, 20 days -- for government agencies to review the earmarks, but also for the public and others to take a look at them and scrutinize them and make sure that they pass some kind of muster or that there's nothing untoward in there. You can look at it, and it might seem OK on the surface, and there could be something in the language.

JUDY WOODRUFF: There's also an element where the president would like the ability to remove earmarks that he disagrees with.

NORMAN ORNSTEIN: What the president would like to do is, we go through this process where you have the full disclosure, you have a number of days, you have hearings, you can vet them thoroughly. But even with that, some clunkers may get through.

So what the president would like is not to be faced with a decision where either you veto an entire bill or you accept everything, but where you can pick out individual ones and force Congress to vote on those individually. It's called, to use the technical term, "rescission authority," but he would need something more than what is in existence in the current law to be able to force Congress to vote on specific individual projects that he thinks are wasteful or that are fishy.

Contracting process is significant

Norm Ornstein

American Enterprise Institute

It's not clear [Obama's] going to get everything that he wants. It is clear that he is likely to get a significant step forward to put more scrutiny on the earmarks that are in the process.

JUDY WOODRUFF: If he were to get Congress to go along with these reforms, would that be a significant change from the way things are done now?

NORMAN ORNSTEIN: If he could get both of those things, it would be significant, along with a third element that he's asked for that Democratic congressional leaders have agreed to, which is that the contracts that might go out to specific for-profit companies now couldn't be written so that they were no-bid contracts or specifically for cronies, you know, written so that it would only fit one company. They would have to go through the same, full, competitive bidding process.

Put those three things together, and you've got some real change, but you've still got a lot of earmarks.

JUDY WOODRUFF: And put all that together. Is that something Congress is likely to go along with? Are they likely to say, "You can have these reforms"?

NORMAN ORNSTEIN: Just as President Obama was issuing his statement with his suggestions, Speaker Pelosi, Majority Leader Reid, and the Appropriations Chairman Obey came out with their own list which paralleled in many ways what the president has asked for, with one exception: They want to use the existing rescission authority, which would mean it's advisory.

The president would say, "I don't like this particular earmark." They would say, "We'll take it under advisement," but it would go through unless they specifically brought it up for a separate vote, and they wouldn't be required to. That's weak. And that's one where we're going to see a fight, I suspect.

JUDY WOODRUFF: So not clear whether he would get what he's asking for?

NORMAN ORNSTEIN: It's not clear he's going to get everything that he wants. It is clear that he is likely to get a significant step forward to put more scrutiny on the earmarks that are in the process.

Congress has also pledged to cut the numbers so that the amount of money is 1 percent or less of discretionary spending. That's still a lot of money, and there will be a number of people upset with that.

Not all earmarks are bad

Norm Ornstein

American Enterprise Institute

It's not clear, Judy, that it would be a good thing for the country to get rid of all earmarks.

JUDY WOODRUFF: Norm, just quickly, why isn't President Obama advocating getting rid of all earmarks? He campaigned against earmarks last year.

NORMAN ORNSTEIN: It's not clear, Judy, that it would be a good thing for the country to get rid of all earmarks. To put it in simplistic terms: Somebody makes these allocation decisions, decides where the specific projects are done, where the money goes.

It can be done by faceless bureaucrats who may have no connection to a local area or by people who understand what the priorities are. If you can get away from the abuses and the corruption and get a little bit more of a check and balance, having members of Congress involved in deciding, presumably working with their local officials and other interests in the local area, where the money ought to go, with some limits, is not a bad thing to have.

Earmark is a dirty word, but somebody does the earmark, and the question is more who does it and whether you can keep abuses from taking place than anything else.

JUDY WOODRUFF: And the critics of earmarks will continue to be critics, even with these reforms, you were saying.

NORMAN ORNSTEIN: There are members of Congress and people outside who believe that any earmark is a bad earmark, that any spending is abuse. That's a bit of a stretch.

But there is no question that we've had very significant abuse because there's a lot of money here and a lot of temptation for individual members. We get things like the "Bridge to Nowhere," and we also get instances of people taking bribes to do things, favors for friends, relatives, or lobbyists.

JUDY WOODRUFF: Those have been in the minority of cases, though, you were saying.

NORMAN ORNSTEIN: It's a minority of cases. You know, there's more that can be done here to try and bring in checks and balances. This is not going to be the last we hear of earmark reform, but it's a significant step along the way.

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